Human Resource Technologies: Reaching the Next Level of HR Management

4/26/2019

BY: CHUCK WERNER

I recently had the opportunity to participate on a panel during an after-hours meeting of local businesses. Part of this discussion was typical, as it revolved around technology in manufacturing and how small to medium-sized businesses can benefit from innovation. What was not typical was the cross-functional nature of the panel; in addition to representatives for shop-floor manufacturing, there also were experts in research, employment and tax law. The ensuing discussion among this diverse group reminded me of an area in business that isn’t frequently considered in this context, but can greatly benefit through the application of technology: Human Resources.

One of the primary improvements provided by the Industrial Internet of Things, and Industry 4.0 as a whole, is the ability to free team members from mundane tasks, enabling them to think more strategically about performance advancements and be more flexible to the changing needs of the business. And what aspect of business has changed more drastically in recent years than HR?

Most notably, recruitment and hiring, a key function of any HR department, has experienced many transformations lately including:

Unemployment has maintained a low percentage, creating more competition for labor resources.

More generations than ever are coexisting within the workforce, so companies must find ways to be attractive to both Baby Boomers and Millennials simultaneously.

As new technologies, products and processes are implemented, the job skills required to run, maintain and improve them are shifting as well. Companies must decide if they should seek external expertise, or upskill internally.

The rules regarding compensation, benefits and policies seemingly change every year. Whether it’s tax-related issues like the elimination of the individual mandate, changes to paid leave through FMLA or even policies regarding the use of personal devices or social media, it is critical for an HR department to be able to develop a comprehensive plan for how to maintain an appropriate balance of employee experience and profitability.

Taking all of this into account, I can’t think of any part of a business where an enhanced focus on strategy is more needed. And while it is now easier than ever for companies to prioritize strategic planning with the enhanced support of technology, in most cases, HR departments are still spending the majority of their time on administrative duties as opposed to strategic actions. This is reflected in the figure below, which demonstrates the typical breakdown of HR activities as explained in this article.

It is interesting to note that in a study by the Center for Effective Organizations, those HR Managers participating reported their perception of time spent on strategy as a minimum of 10% higher than reality. This likely means that while they may have recognized the importance of an increased strategic focus, and even planned for it, they were unable to operate according to that plan. This makes sense, considering the elimination of any given HR service will usually result in either a compliance failure, a costly error or a real – or perceived – takeaway by the workforce. But this does not mean it is impossible for an HR team to find ways to provide these services while still generating more opportunity for strategic activities.

Find Time for Strategy with Innovation
As shown in the above figure, most HR time is spent on administrative tasks such as hiring, payroll and employee relations. Allof these areas can be improved through the use of technology, and in turn free up more time for strategic planning. Self-service technologies, for example, not only enable associates to access their personal records for attendance, vacation and performance, but also serve as an anonymous conduit for feedback – a way for employees to share improvement ideas, or even recognize the performance of a fellow team member. Augmented and Virtual Reality (AR & VR) also ensure employees receive proper training and serve as a guide to refresh the team on activities they may not perform frequently. At the same time, the programs behind the AR/VR solution can collect the data needed to show compliance to training processes.

Another consideration for technology is the implementation of a Human Resource Information (or Management) System. These systems provide the ability to collect data, reducing the amount of time spent gathering, filing and maintaining records. Even more critical to success, many of these systems allow for the data to be compiled and analyzed as desired, minimizing time needed to prepare information for strategic functions. Some systems have the ability to employ artificial intelligence functions to detect and manage new employment, tax and pay rules by automatically detecting when they are applicable, rather than relying on people to remember each new law and catch them manually.

As with any application of technology, the first step is to define the needs of the business. By knowing where the HR team is spending their time and implementing what will best support both the Voice of Business and the Voice of the Customer (internally and externally), the benefits of technology adoption can be truly realized.

Chuck Werner, Lean Program Manager
Chuck has been a Lean Program Manager at The Center since 2016. His areas of expertise are in Lean, Six Sigma and Quality. Chuck has devoted many years to practicing Six Sigma methods, ultimately earning a Six Sigma Master Black Belt in 2011. He is passionate about helping small and medium-sized manufacturers become more prosperous using a variety of tools and methods gathered from over 27 years of experience. Additionally, Chuck is a certified ISO/QS9000 Lead Assessor, Training Within Industry (TWI) Master Trainer and is certified in OSHA Compliance and Accident Reduction.

Since 1991, the Michigan Manufacturing Technology Center has assisted Michigan’s small and medium-sized businesses to successfully compete and grow. Through personalized services designed to meet the needs of clients, we develop more effective business leaders, drive product and process innovation, promote company-wide operational excellence and foster creative strategies for business growth and greater profitability. Find us at www.the-center.org.